Raises support price by Rs 380/qtl; marginal rise for wheat.
Pulses saw the highest rise of Rs 340- 380 per quintal in minimum support price (MSP), the government announcing these for the current rabi season. The decision is in line with government efforts to increase their sowing, to meet the increasing demand for the crop.
The MSPs of masur and chana were increased by Rs 380 per qtl and Rs 340 per qtl respectively, translating into a 20 per cent increase, making pulses the likely highest gainer in the rabi marketing season, due to start in April 2011.
The decision by the Cabinet Committee on Economic Affairs is aimed at encouraging farmers to take up cultivation of masur and chana in a big way, so that India could reduce dependence on imports.
Prices of other major rabi crops were also raised, with wheat seeing a rise of Rs 20, to Rs 1,120 per qtl. That for rapeseed (mustard), the main oilseed crop in the rabi season, has been fixed at Rs 1,850 per qtl, up Rs 20 from the previous year, while that of safflower has been raised by Rs 120 to Rs 1,800 per qtl for the season. India is a net importer of edible oils, buying palm oil from Malaysia and Indonesia and soft oils from Argentina and Brazil.
The MSP for barley was fixed at Rs 780 per qtl, up by Rs 30 from the previous year.
The government hopes to raise pulses’ output in the current crop year that started in July to 16.5 million tonnes, as compared to 14.7 mt in the previous year.
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The wheat MSP rises from Rs 1,100 per qtl to Rs 1,120 per qtl. Food Corporation of India and other designated state agencies will continue to provide price support here. This implies an estimated seven per cent increase in government food subsidy for wheat during the rabi season, at Rs 2,280 crore, taking the 2009-10 wheat procurement of 25.3 mt into consideration. However food ministry officials said it would be too early to estimate the impact on food subsidy, as that would depend on procurement, offtake and the carrying stock with various government agencies.
For chana, an official stated, the impact on government subsidy will be insignificant, as the MSP at Rs 2,100 per qtl is much below the current market price, which is in the range of Rs 2,400-2,900 per qtl. The market price for masur is similarly at Rs 3,500-3,800 per qtl, much higher than the increased MSP of Rs 2,250 per qtl.
"In some of these cases, market prices are much higher than MSP. The MSP is based on CACP (Committee on Agricultural Costs and Prices) recommendations. If there is shortage, what would happen (is that) the market prices would be much higher," said home minister P Chidambaram at a briefing after the meet.
The National Agricultural Cooperative Marketing Federation of India will remain the nodal agency for procurement of oilseeds and pulses, and losses, if any, will be reimbursed by the government.
Amendments to seeds Bill
The government today approved additional amendments to the Seeds Bill, 2004, which includes raising penalties for offences like sale of spurious seeds.
“The Union Cabinet today approved moving additional amendments to the Seeds Bill, 2004,” an official release said.
The additional amendments provided for submission of seed-related periodic returns to state governments and enhancement in penalties of offences, it added.